Is the Economy Cracking Beneath the Surface? What Financial Advisors Must Watch in 2025. 

Behind the Numbers: Three Risk Factors You Need to Understand

1. A Weakening Labor Market: Jobless claims are rising, and recent college grads are facing a 5.8% unemployment rate—the highest in a decade. As AI accelerates job displacement across consulting, tech, and finance, more pressure is being placed on the already softening labor market.
2. Tariff-Driven Business Caution: Erratic tariff policy is chilling corporate investment and hiring plans. Companies are holding back—and that hesitation could stall growth.
3. Consumer Spending on Thin Ice: Consumers are relying on debt to maintain lifestyles. Student loan, auto loan, and credit card delinquencies are climbing, just as inflation and interest rates remain sticky. 

What Should Financial Advisors Do Next? 

CFRA’s updated model portfolio recommends increasing cash holdings to 15% and maintaining a strong 25% allocation to high-quality bonds — especially short- and intermediate-term U.S. Treasuries. 

Wondering how to recalibrate allocations in light of stretched equity valuations, lagging Fed policy, and rising consumer credit risk? 

Get the Full Picture – Download CFRA’s Full Thematic Outlook 

➡️ Download the full report now.

This exclusive report includes: 

• Updated unemployment, earnings, and inflation forecasts; 
• Delinquency trend breakdowns by debt type; 
• Asset allocation recommendations for moderate-risk portfolios; 
• Sector risks and equity valuation analysis.